Bulk Invest gets OK to transfer Western Bulk floaters, extend to 2019

By Susanna Moon

Chicago, Feb. 22 – Bulk Invest ASA said it garnered the needed approval to amend Western Bulk ASA’s floating-rate senior bonds due 2017 at a meeting held Monday in Oslo.

With the needed majority approval, the bond loan has been transferred to Kistefos Equity Operations AS.

There were enough holders to form a quorum, and the measure obtained 100% of the votes, according to a notice from bond trustee Nordic Trustee ASA.

As previously reported, the company was asking for holder approval to transfer its bonds guaranteed by Western Bulk Chartering AS to a new company to be controlled by Kistefos AS.

Western Bulk sought amendments needed to facilitate the sale of Western Bulk Chartering and to change the debtor under Western Bulk ASA’s bond issue.

The company was offering $16 million for the shares in Western Bulk Chartering and asking that the bonds be rolled over to the new company.

The main required bond amendments were as follows:

• To extend the maturity date by two years until April 2019;

• To reduce the coupon margin to 325 basis points from 675 bps; and

• To amend and remove some covenants.

The company noted that 2015 was extremely challenging for the dry bulk market and that the environment has continued to worsen into 2016, now “at all-time low levels,” according to a company presentation.

Given the situation, the recapitalization plan announced in the fourth quarter appears insufficient, with the company now looking to stem the cash leakage from Western Bulk Chartering by selling the company to Kistefos, the company said.

WB Shipholding’s losses have been funded using the profits and liquidity of Western Bulk Chartering, the company noted.

“As WB Shipholding continues to drain cash in a challenging market, Western Bulk ASA is dependent on reaching an agreement with its creditors for a restructuring of its commitments,” the company said.

Pareto Securities (+47 22 87 87 70) is the adviser.

Western Bulk is a dry bulk shipping company based in Oslo.

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